Honda has warned that it may report its first annual net loss since becoming a public company in the 1950s, as the automaker revises its electric vehicle strategy and faces slowing EV demand in key markets.
The Japanese carmaker said it expects a net loss between ¥360 billion and ¥630 billion for the fiscal year ending this month. This marks a sharp reversal from its earlier forecast of a ¥360 billion profit.
The projected loss follows a major overhaul of Honda’s electrification plans, including the cancellation of three electric vehicle models planned for North America. The scrapped vehicles include the Honda 0 SUV, Honda 0 Saloon, and the Acura RSX.
According to Honda President Toshihiro Mibe, demand for electric vehicles in the United States has been far weaker than expected, with sales reaching less than half of the company’s earlier projections.
The company also pointed to broader challenges affecting its automobile business, including changes in the global EV market, trade pressures such as U.S. tariffs, and rising competition from Chinese electric vehicle manufacturers.
Honda acknowledged difficulties in China, where domestic EV companies have rapidly advanced in product development, pricing, and software capabilities, making it harder for traditional global automakers to compete.
Despite the setback, Honda maintains its long-term goal of transitioning to 100% battery-electric and fuel-cell vehicle sales by 2040, although it now plans to expand hybrid offerings, particularly in the United States, to better match current market demand.
The announcement highlights the growing uncertainty facing global automakers as they balance EV investments with shifting consumer demand and intensifying competition in the rapidly evolving electric mobility market.
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